Ashwin, Managing Director Nauvata Energy Transition (NET) Enterprise Pvt. Ltd. NET Enterprise is an EPCM, PMC and engineering services provider in oil & gas and energy transition areas such as biofuels, carbon capture, plastic circularity and green hydrogen.

We have reached a stage where our choices are limited; energy transition and sustainability in our energy use are more a compulsion than an option. Leaders play a key role in guiding the change and ushering their organizations into the new but necessary world of energy transition and sustainability.

Leaders play a crucial role in guiding change, quite literally by the position and authority they hold, as well as by setting an example of their practices. As leaders we have a responsibility to society, this can only be done by following certain paths that keep the organization’s promises on adopting sustainable practices true and credible. It is not simply about tall claims, and the theoretical ideation of green practices, but rather about the actual implementation of the same. A lot of the time there is a disconnect between the vision for sustainability and the execution of the green practices. We need to inculcate awareness and education, to incorporate green behavior.

The major challenge that many face in doing so is, that we can often fall prey to “what is the right thing to do, vs. what is good for business”. Sustainable practices, on a macro level, that is, may come across as poor business if seen in the narrow sense of profit and loss based on the existing accounting practices. Because many of these practices are still new, so we are yet to find solutions for their mass implementation, and because conventional options tend to be more cost-effective, the camp of what is good for business triumphs over what is the right thing to do. Sustainable business models are made with the big picture and long-term impact in mind, but practically businesses also require profits, and that comes from short-term, cost-cutting solutions.

Another challenge that businesses face while changing their business models towards a more sustainable path is the response of the stakeholders. Society at large, more so in India, is not ready yet to pay a premium for green products. Stakeholders play a crucial role in businesses, and till the time there is no consensus on what the ideals of a particular business are, there will always be a disconnect. This is why green behaviour and the inculcation of green values are extremely necessary – both in the business but also in purchasing behaviors of the masses. All parties involved in a business, including the leader, stakeholders, as well as the consumer/ customer, need to imbibe the same values and goals for the long-term sustenance of our well–being.

Leaders have the responsibility of setting standards for ethical decision-making, investing in sustainable changes and incorporating them, playing a key role in awareness and education, as well as setting values and goals that are aligned with a sustainable future. Some of the key levers that leaders can use to drive the change are noted below:

The major challenge that many face in doing so is, that we can often fall prey to “what is the right thing to do, vs. what is good for business”.

Shaping Vision – Vision and Mission statements, Company profile, and website should reflect the vision of company towards attaining a Net Zero future. Inspiring action by walking the talk and talking the talk is the mark of visible leadership. Leaders can make efforts to reduce personal CO2 footprint by optimizing travel and where possible, cycling or walking to work etc.

Driving strategy - Publish a credible Net Zero strategy backed up with a resource-loaded schedule and a milestone-driven plan for implementation that gets updated or rebase-lined, if necessary, at every shareholder engagement. Effectively, this requires setting clear goals and strategies to achieve, for example, working towards implementing frameworks that reduce carbon footprints and enhancing resource efficiency.

Policy Advocacy - Policy is another crucial way in which leaders advocate for and influence the growth of sustainable practices. They engage with policymakers, participate in forums, lobby for change, and collaborate with others. They advocate for policies that promote environmental change, environmental equity, etc.

Creating a culture of innovations in the organization: Innovative solutions are often required for sustainability challenges, and leaders must foster an environment that encourages creativity and experimentation. These also help in incentivizing investments towards such practices, and the research that goes into developing green technologies, and embracing new business models. There is also a need to create opportunities for professional development and growth in the field of sustainability. By supporting educational programs, internships, and partnerships, a collective goal towards a better future is created.

Ethical leadership and a sense of social responsibility build the foundation for moving towards sustainability. These ethical standards must be upheld. Their commitment to sustainability can inspire and mobilize stakeholders, align organizational goals with environmental and social responsibilities and ensure the implementation of effective practices. By leading with a focus on long-term impact and integrating sustainability into core values.

Leaders lead by example. They should help the organization visualize what a good sustainable future looks like. This is not an easy task. It needs conviction and sense of urgency in action, more than arm-chair theorizing about energy transition and sustainability.